I am regularly asked questions, so I thought that today I would write out a few common questions that I get along with my answers.
Do you really use cash envelopes?
Yes. Jenn and I believe that it is the best way for us to ensure that we do not overspend the amount budgeted. When we utilized the debit card, we blew the budget EVERY SINGLE MONTH! Therefore, we use the cash envelope system. I will say, however, that we only use cash envelopes for those categories that tend to go out of control – groceries, dining out, entertainment, blow money, household (stamps, haircuts, flowers, plants, holiday decorations, etc.).
We do not use cash envelopes for the utilities, the house payment, or other expenses that we do not have the ability to splurge on. One category that we are debating right now is gasoline. We have always used a cash envelope, but it is not like we are going to splurge on an extra tank of gas. Where would I put it? We may be moving that to a debit card transaction for a trial period.
How do you and Jenn put together a budget?
Whenever we plan an outing or event, we mark it on the calendar. About 1 or 2 days before the month begins, we will sit down and put together the budget using the budget forms (you can get your free copy by clicking "Tools" in the top right-hand corner). We have kept loaded the expenses from the previous month and adjust them according to this particular month. Because this month is December and we will travel more and spend more time out on the town with family, we bumped up the "Gasoline" and "Entertainment" categories. We also bumped up the "Household" category because we are purchasing Christmas Cards and snail-mailing them. We knocked down the "Groceries" category because we will be at our family Christmas and eating leftovers for a week (YES!!!!).
We then ensure that the secret formula is applied: INCOME – OUTGO = EXACTLY ZERO
Print it out, put the cash in envelopes, write the checks, the end. Fun stuff! Total Time: 20 minutes
What type of cash envelopes do you use?
The ones handed out by the bank. We ask for a couple of extra ones and replace the torn/battered ones. I know other people who use the free envelopes that come along with those wonderful credit card applications. Best part – Free.
Does your daughter use cash envelopes?
Yes, our daughter does use cash envelopes. It is priceless! When the money runs out, it's over!
Do you tithe (give 10% away)?
ABSOLUTELY – and then some. I believe that people who live in the wealthiest nation in the world have a special responsibility to help others. Jenn and I passionately believe in some things – Purdue University (Go Boilers!), NewSpring Church (Yeah!), and Missionary Work (Alaskan remote regions and the Military). We want to support these causes financially so that they can accomplish their work effectively! Maybe we should give more to Purdue because their football team has struggled (SMILE), but we LOVE these things. We can't help BUT give.
Does Jenn believe in this stuff as passionately as you do?
I would say that Jenn believes in this stuff at least FOUR TIMES more than I do! Here is the big secret: I did not come up with the budget in our family. It was JENN!!! I am the spender! I hated the word "budget"! But when I saw that it would enable us to WORK TOGETHER and achieve the PLANS we have for our life! Oh yeah, I became a kool-aid drinking fool about this stuff!
Let me know if this type of Q&A helps you! If you have any questions that you would like me to answer on this blog, post it in the comments or send me an e-mail. Thanks!